S&P 500, US Dollar Talking Points
- It’s been a month of extremes in global markets as a shocking and historically aggressive equity sell-off finally found some semblance of support this week.
- The US Dollar[1] put in a strong rally as risk aversion was heating up in the middle of March, gaining as much as 8.8% over a ten-day-period.
- With the S&P 500 digging into support and the US Dollar tempering gains, both reactions to recent FOMC[2] actions – the big question now is whether the worst is over or whether there’s more selling yet to come.
S&P 500 Finds Support After Limit-Down Sunday Open
We’re nearing the close of what’s been another eventful week across global markets. The big question at this point is whether a low has been set in US equities as a trove of various stimulus measures[3] from the Federal Reserve may have finally helped to bring some support into play.
Weekend risk remains a daunting prospect, however, as the past couple of weeks have seen US equity futures go ‘limit down’ after the Sunday open[4] – even with big announcements from the Federal Reserve designed to do the exact opposite. But, grading the performance of the US Dollar combined with a bright patch of performance in US equities after what had become a brutal backdrop – hope remains that risk aversion may finally be taking a rest.
In the S&P 500, the big item this week was price action moving into a technical ‘bull market,’ denoted by a bounce of 20% or more which showed from the Monday low up to the Thursday high. This comes just a couple of weeks after the S&P 500 had moved into ‘bear
